|
|
Hospital Financial Distress, Recovery and Closure: A Political Cost Perspective
Li - Lin (Sunny) Liu,
California State
University--Dominguez Hills
Kathryn J. Jervis, University of Rhode Island
Mustafa (Mike) Z. Younis, Jackson State University
Dana A. Forgione, University of Texas at San Antonio
ABSTRACT: We examine the association between the form of ownership control in hospitals that may impact hospital performance and hospital financial distress, recovery or closure, from an Agency theory and political cost perspective. The Medicare Payment Advisory Commission has stated that hospital closures are important for evaluating the distribution of cost, quality and access to healthcare throughout the US. The Commission explicitly considers the impact of hospital closures in evaluating the adequacy of Medicare payment policy on a national scale. We find that closure is significantly associated with low: occupancy, ROI, asset turnover, case mix index, and lack of affiliation with a multihospital system. It is also significantly associated with urban location, teaching programs, high Medicare & Medicaid patient populations, and high debt. Our hypotheses are supported by these results.
Full-Text is no longer available online. Please contact the author(s) for more information about this manuscript.
Back to Session Listing
|